ABSTRACT: In April 2010, President Felipe Calderon sent the Mexican Congress a bill to amend the Federal Law of Economic Competition ("LFCE") and other statutes, in order to strengthen competition policy and law enforcement. This bill has been approved with some minor changes and additions by the House of Representatives and probably will be discussed and approved by the Senate in its next legislative session (September-December).

In general terms, the proposed amendments are aimed to increase sanctions for illegal conducts, including criminalization of absolute monopolistic practices, and to strengthen the Federal Competition Commission's ("CFC" or "Commission") powers to investigate and punish said conducts.

According to the bill, the proposed core lines of action are:

1. To facilitate compliance of competition legislation and to focus CFC's attention and resources on relevant cases;

2. To improve effectiveness, efficiency, and transparency of CFC's operations; and

3. To achieve a more efficient competition policy through the adoption of effective instruments to investigate and sanction anticompetitive practices.

ABSTRACT: We consider non-price advertising by retail firms that are privately informed as to their respective production costs. We construct an advertising equilibrium, in which informed consumers use an advertising search rule whereby they buy from the highest-advertising firm. Consumers are rational in using the advertising search rule, since the lowest-cost firm advertises the most and also selects the lowest price. Even though the advertising equilibrium facilitates productive efficiency, we establish conditions under which firms enjoy higher expected profit when advertising is banned. Consumer welfare falls in this case, however. Under free entry, social surplus is higher when advertising is allowed. In addition, we consider a benchmark model of price competition; we provide comparative-statics results with respect to the number of informed consumers, the number of firms and the distribution of costs; and we consider the pos! sibility of sequential search.

ABSTRACT: The OFT's new short-form opinion process was developed in responseto concerns expressed by businesses and Government policy makersthat some beneficial collaboration agreements were not goingahead for fear of breaching competition law. The lack of recentprecedents in a self-assessment world appeared to be resultingin businesses and their advisers adopting a cautious approachat times. It is hoped that the guidance provided in the newshort-form opinions goes some way to fill this gap so that competitionlaw is not seen as chilling procompetitive agreements. The firstshort-form opinion has been published recently.

ABSTRACT: During the last two years, the Commission has continued to imposevery heavy fines on undertakings that have infringed Articles81 or 82 EC (now Articles 101 and 102 TFEU). At the same time,the first decisions applying the 2006 Fining Guidelines showthat the Commission is sometimes willing to adapt its generalmethodology to specific situations. For instance, while theCommission promotes a broad, and sometimes excessively broad,interpretation of the rules that allow it to find a single,continuous infringement, in several cases it has adopted a calibratedapproach taking into account the lower probative value of theevidence on which it relied for certain periods of the infringement.The notion of ‘value of sales’, a key element inthe calculation of fines, has more generally given rise to manyadaptations. In 2008–2009, the Commission has also imposedseveral fines for infringements of rules other than Articles101 and 102 TFEU, in particular for obstruction of an investigation(in this case the breach of a seal), non-compliance with a Commissiondecision, or gun-jumping. As to the EU Courts, in 2008–2009they have indirectly confirmed the legality of Article 23(2)of Regulation No 1/2003 and ruled that the suspension of therunning of the statute of limitations did not apply erga omnes.Some judgments have also given signs that the EU Courts' controlof legality on certain elements of these fines would remainlimited. This makes it even more crucial that the EU Courtsexercise their unlimited jurisdiction proactively.

ABSTRACT: This article provides some reflections on the legal and economiccontext of the European Commission's 2009 Intel Decision. Itfirst gives a short overview of the debate relating to the interplaybetween law and economics in the field of unilateral conduct,and then looks at the legal and economic framework that wasapplied by the Commission in the Intel case. In this context,it discusses a number of issues relating to the factual findingsof the Decision as well as the harm that resulted from Intel'sconduct. One of the article's key conclusions is that thereis no inherent tension between the framework provided by establishedcase law and the fact that, in choosing which cases to pursue,the Commission is entitled to focus its priorities on thosetypes of conduct that are most harmful to consumers. The articlealso provides a few words of perspective on the fine, an issuethat attracts significant attention in its own right.

ABSTRACT: The effect of competition on the quality of health care remains a contested issue. Most empirical estimates rely on inference from non experimental data. In contrast, this paper exploits a pro-competitive policy reform to provide estimates of the impact of competition on hospital outcomes. The English government introduced a policy in 2006 to promote competition between hospitals. Patients were given choice of location for hospital care and provided information on the quality and timeliness of care. Prices, previously negotiated between buyer and seller, were set centrally under a DRG type system. Using this policy to implement a difference-in-differences research design we estimate the impact of the introduction of competition on not only clinical outcomes but also productivity and expenditure. Our data set is large, containing information on approximately 68,000 discharges per year per hospital from 162 hospitals. We find that the effect of competition is to save lives without raising costs. Patients discharged from hospitals located in markets where competition was more feasible were less likely to die, had shorter length of stay and were treated at the same cost.

The pharmaceutical sector continues to be one of the main
focus areas for competition authorities throughout the world.This conference provides an update on the
major developments affecting the sector including the General Court's recent
judgment in the AstraZeneca case, the first judgment on dominance and abusive
practices in the pharmaceutical sector.

Cancellations must be received in writing. Cancellations
received in writing two weeks before the conference will receive a refund less
10% + TVA. Cancellations received one week before will receive a refund less
50% + TVA. Cancellations received less than a week before the conference will
not receive a refund. Substitute delegates are welcome at any time.

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a database and may be shared with other Law Business Research publications. If
you do not want us to use your information for marketing purposes please
contact GCRconferences@GlobalCompetitionReview.com.

ABSTRACT: This paper explores the effects of competition on risk-seeking behavior and firm performance within the financial services industry. It does so by exploiting a change in British mutual fund regulations that lowered a barrier to entry. In 1997, British regulators removed a requirement that mutual funds organize as trusts, freeing them to organize as either trusts or corporations (trust law subjects fund managers to stricter fiduciary responsibilities than corporate law does). Exploiting this regulatory shock, I trace non-trivial linkages among industry competition, risk taking, and performance. After the removal of the entry barrier, the industry experienced an increase in competition. Increased competition led to a significant increase in risk-taking behavior. Results suggest that increased competition also generated an improvement in risk-adjusted performance. While competition did not produce tangible cost savings for consumers, it did mitigate certain harmful investor behaviors, such as chasing past performance.

ABSTRACT: The recent trend in the federal courts has been to reduce the already limited potential antitrust liability faced by dominant firms that individually refuse to supply their rivals with goods or services the latter need to compete. However, important differences have emerged among courts in the extent to which they allow antitrust to reach refusals to supply property protected by intellectual property rights. Courts have differed over whether a firm’s unilateral refusal to supply a rival with IP should be judged under the Section 2 approach that applies to other (non-IP) property or instead should be exempted from normal antitrust scrutiny. Some circuit courts treat refusals to supply IP as susceptible to rule-of-reason inquiry under Section 2 of the Sherman Act whereas at least one court, the U.S. Court of Appeals for the Federal Circuit, essentially exempts refusals to deal in IP from that antitrust inquiry. This article argues that neither economics nor IP policy considerations provide a sound basis for exempting refusals to supply IP from antitrust law’s general liability standard for unilateral refusals to deal. Where antitrust enforcement treats IP deferentially, it should be because in a particular case there is a link between IP and the innovation and competition considerations that in most cases weigh against antitrust mandates to deal in any property. Sometimes those factors will be magnified where IP is at stake; but they are not so systematically different for intellectual property that refusals to supply IP should be exempted from the antitrust standard applicable to other property.

ABSTRACT: The present article discusses remedies for coordinated effects under the EU Merger Regulation. To this end, it is divided in three parts. Part I reviews the remedies applied to date by the Commission in coordinated effects cases (I). Part II discusses the substantive standard against which such remedies are evaluated (II). Part III underlines a number of practical difficulties which arise when merging parties devise remedies to allay the Commission’s coordinated effects concerns (III).

ABSTRACT: This essay uses one context - a monopolist’s deceptive advertising or product disparagement - to illustrate how competition authorities and courts should evaluate a monopolist’s deception under the federal antitrust laws. Competition authorities should target a monopolist’s anticompetitive deception, which courts should treat as a prima facie violation of the Sherman Act without requiring a full-blown rule of reason analysis or an arbitrary, multi-factor standard.

ABSTRACT: On April 30, 2010, the Mexican Congress approved a long-awaited set of reforms to the Federal Competition Law ("FCL").The reform is particularly broad in terms of the general areas of interest covered:

1. A first set of reforms deals with the enhancement of the transparency through which the Mexican Competition Commission ("MCC") enforces competition law. In this regard, for example, the reform proposes the implementation of oral hearings as part of the deliberation procedures carried out by the MCC and the compulsory release of MCC' guidelines in key areas of competition policy as fines, merger control, and the identification of significant market power.

2. A second set of reforms is related to the simplification of administrative procedures regarding the notification of certain type of mergers and the implementation of a mechanism for the anticipated termination of cases involving allegedly anticompetitive behavior.

3. A third set of reforms notably affects the day-to-day enforcement of competition policy in Mexico and involves proposals leading to the strengthening of the MCC's legal powers to implement effective "dawn raids" and also the proposal for the creation of competition-specific tribunals.

4. The final set of reforms approved by the Congress is, from an economic perspective, of particular interest since it deals with the always-controversial topics of fines and joint dominance.

A general discussion of the approved reform is beyond the scope of this paper; the following discussion focuses exclusively on the discussion of some of the challenges that the implementation of the concept of joint dominance may pose to the Mexican competition regime.

ABSTRACT: In 2002 five of the largest Chilean private health insurance providers ("Isapres") reduced the coverage they offered to their members without reducing the price of their plans. In other words, their members were given worse health plans than they previously had, but at the same price. Consequently, in 2005 the National Antitrust Prosecutor (Fiscalía Nacional Económica "FNE") accused the five Isapres-Banmédica, Colmena, Consalud, ING, and Vida Tres-of collusion before the Chilean Competition Court (Tribunal de Defensa de la Libre Competencia, "TDLC"). More than two years thereafter, the TDLC ruled, in a "split decision" (3 votes in favor and 2 against) that there was no sufficient evidence that the Isapres colluded to reduce the coverage of their plans, and acquitted them. The case was appealed before the Supreme Court of Justice, which, in January 2008, also issued a split decision, based on similar arguments and confirmed the previous decision.

The FNE did not provide any "smoking gun" about the alleged collusive agreement. Before 2009 the FNE had no legal power to conduct dawn raids, carry out unannounced inspections, or intercept communications, which significantly limited the possibility of finding hard evidence of collusion. The accusation against the health insurance providers was mainly based on economic and econometric evidence detailed in Agostini et al. (2008), which does not reject the collusion hypothesis, but rejects the cost-increase hypothesis used by the five Isapres to explain their parallel behavior in terms of reducing coverage.

A brief recount of the case and an analysis of the TDLC´s ruling are presented in the following pages. This analysis considers the fact that the system to be followed by the TDLC to assess the proof is the rule of reason, which requires the judges to assess the evidence based on their experience, formal rules of logic, and economic theory. Likewise, TDLC judges are obliged to explain and justify their judgments with not only their appreciation of the proof, but also an account of all the evidence submitted.

It is our opinion that the TDLC judgment is precise and correct in some disputed points and sets important precedents for the future of the health insurance industry. However, the majority decision has essential errors that ultimately led to the acquittal of the accused Isapres. Such failures, according to our analysis, are related to the fact that part of the submitted evidence (a substantial part in our opinion) and part of the rationale followed by the judges are contrary to economic theory and furthermore-as implicitly admitted by the minority decision-are contrary to logic.

Federal Trade Commission Chairman Jon Leibowitz will be joined by Bureau of Competition Director Richard Feinstein at FTC Headquarters on Wednesday, August 4, 2010, at 10:00 a.m. ET to detail the terms of the Commission’s order settling charges that Intel Corporation used anticompetitive tactics that stifled innovation and harmed consumers in the market for computer microprocessors, graphics processing units, and chipsets. The FTC’s complaint, filed in December 2009, charged Intel with waging a systematic campaign to shut out rivals’ competing microchips by cutting off their access to the marketplace, and harming consumers.

WHO:

Jon Leibowitz, Chairman, Federal Trade Commission

Richard Feinstein, Director, FTC Bureau of Competition

Other FTC Commissioners

WHEN:

August 4, 2010, 10:00 a.m. ET

For reporters who cannot attend the press conference call-in lines will be available. The press conference will also be webcast.

ABSTRACT: EU merger regulations rely on the “significant impediment to effective competition” substantive test. However, the clause that incorporates these tests is not clear regarding implementation criteria. As a result, in many cases assessment and decisions about Mergers and Acquisitions are adopted in an uncertain legal context.

Often this situation is justified for two reasons: first, the need to incorporate the economic complexity into the decision; and second, the prospective nature of merger assessment.

Nevertheless, from the perspective of Law many questions arise. Prospective decisions are unsuitable to deal with classic theories of regulation and judicial review. As we explain in this paper, the European Commission adopts its decision based on the foreseeable behaviour of an undertaking. European Courts recognize the Commission’s ample discretion to assess merger on a case-by-case basis and limit the scope of judicial review. As a result, commentators have criticized the EC merger regulation.

In this paper these issues are considered. In the first part, we study the clause that incorporates the substantive test in EC merger regulation. In the second we deal with the scope of judicial review of prospective decisions and appropriate standard of proof. Next, we argue that reform of EC merger administrative procedures will reduce the scope of discretionary authority to reasonable levels and improve the decision-making process. Finally, we suggest tools developed in the risk regulation literature to improve legitimacy and ensure rationality of the European Commission’s decisions.

ABSTRACT: Antitrust enforcement has long helped to prevent anticompetitive conduct and protect consumer welfare in regulated industries. Despite that valuable role, the Supreme Court’s decisions in Credit Suisse v. Billing and Verizon v. Trinko have reduced the scope of antitrust enforcement against regulated firms. This article analyzes the reasoning and potential consequences of the Court’s recent decisions. It provides a critique of the reasoning behind the Supreme Court’s redrawing of the relationship between antitrust and regulation and explains how Credit Suisse and Trinko could saddle regulators with a choice between inefficiently strong and overly weak regulation as economic conditions change in regulated industries. The article then discusses possible remedies and concludes that consumers and industry would benefit from a rebalancing of antitrust and regulation.

ABSTRACT: The context of post-liberalization has led to different tensions between competition law and regulation in several markets such as telecommunications and electricity. Whereas certain segments of those markets remain considerably regulated, competition prevails in other sectors. However, competition law and regulation coexist in most segments and this interface has created new challenges for competition and regulatory authorities. For instance, the same matter can be under the scope of two different sets of rules and different authorities may be empowered to deal with the same issue.

Several questions arise from this interface between competition law and regulation. First, it is unclear to what extent competition law may be applicable in regulated markets. The second question is whether regulation can be used as a defense for a claim based on anticompetitive conducts. The answer to both questions is not an easy task.

If these challenges have been difficult to solve for U.S. and EU authorities, the situation has been more problematic for developing countries like Chile, whose competition and regulatory systems lack the strength and tradition of more developed regimes.

In chapter II I will show, based on relevant case law, that U.S. and EU competition law systems have approached this matter in different ways and this divergence might be explained (not only) by the objectives pursued by competition law in both jurisdictions.

In chapter III I will describe how Chilean authorities have approached to this problem and will conclude that those authorities have left a considerable scope for competition law even where detailed regulation exists. This particular view may be explained by a number of legal changes introduced since 2003 that have entailed a new design of the competition law system.